AFTER SALES SERVICES AND CUSTOMER RELATIONSHIP …

AFTER-SALES SERVICES AND CUSTOMER RELATIONSHIP MARKETING:

- A MULTIPLE CASE STUDY WITHIN THE SWEDISH HEAVY

EQUIPMENT MACHINERY INDUSTRY

Authors: Erika Egonsson Marketing Program

Khulan Bayarsaikhan Marketing Program

Ting Ting Ly Marketing Program

Tutor: Mosad Zineldin Examiner: Rana Mostaghel Subject: RSeulabtjieocnts: hRieplaatniodnssehrivpicaenmd aserkrveitcinegmarketing Level and Semester: Bachelor Thesis

Spring 2013

ABSTRACT

Due to growing complexities in business-to-business products, the relationship between a seller and a buyer usually never ends after the purchase transaction. Customers buy augmented products, expecting bundle of values that come with the product which will satisfy the buyer. Thus, integrating services into the core offerings in manufacturing industries has taken crucial importance. Especially, after-sales service is considered a tool for enhancing a valuable advantage for the customer as well as it is a business opportunity for the company.

After-sales services have proven to be of importance, and a strategic after-sales framework is necessary. Three major activities that play a crucial role within the after-sales services in the manufacturing industry are field technical assistance, spare parts distribution and customer care. However, intensive studies regarding after-sales in a specific industry are lacking. This thesis focuses on the Swedish heavy equipment machinery industry organizations of different sizes and thus, the purpose of this study is to investigate the major activities of after-sales service focusing on customer relationship among three classified sizes of after-sales service providers.

A multiple case study has been carried out in the form of semi-structured interviews with three organizations; one small, one medium and one large size after-sales service providers.

The study reveals that customer care is the most focused activity of after-sales services in the heavy equipment machinery industry in Sweden. Simultaneously, it shows the most significant differences of offers depending on the size of the company, in relation to the remaining activities. Field technical assistance appears to be the part of after-sales that produces least profit in the industry. Thus, it might be the reason that small organizations would rather tend to outsource it, in order to avoid high costs. Spare parts distribution can be considered as the most profitable activity of after-sales. The warehouses and repair centers of companies naturally varied according to firm sizes. Although the organizations do not state formal goals for providing after-sales service to its customers, they are aware of its importance and aim for satisfying customer demands. All organizations are convinced that if after-sales services are not handled properly, they face the risk of losing the customer. Finally, this research indicates that organizations in the heavy equipment machinery industry have a lot of room for improvements to its after-sales activities with respect to their relationship with customers, which can be accomplished in strategic and systematic ways.

Keywords: After-sales service, Field technical assistance, Spare parts distribution, Customer care, Customer relationship marketing, Firm size

ACKNOWLEDGEMENT

This study was conducted as our bachelor thesis during our last semester at the International Marketing Program in spring 2013. Within our bachelor thesis we have had the chance to, within a time frame, show our independency in applying our knowledge obtained during our years in the program to the independent degree project. It has surely been an improving and valuable experience. Furthermore, a deeper knowledge in after-sales and its area have been achieved, and the qualitative research approach has given us the opportunity to approach and gain an insight into organizations in real life. This project was manageable due to a number of people that we would like to thank. Firstly, we would like to show our gratitude by specifically thanking our tutor Dr. Mosad Zineldin and examiner Dr. Rana Mostaghel for surpassing our expectations about the time and qualitative feedback devoted to us. We would also like to thank Dr. Magnus Hultman for his valuable feedback and comments. Lastly, we would like to thank the time and support of the three organizations which participated in this research.

Linnaeus University May 2013

Erika Egonsson, Khulan Bayarsaikhan and Ting Ting Ly

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